5 Safe Investment Options
We are living in an uncertain environment where any sudden change can affect economy badly. Therefore, we always search for save investment methods since none of us wants a loss of principal amount at any cost. A safe investment method offers peace of mind to us because we know that our principal will remain intact while we are enjoying monthly or bimonthly return. At this point, I like to clear one thing that a safe investment brings lower return as compared to risky investment. There is direct relationship between risk and return: high risk high return, low risk low return. Now I would like to provide you the details of 5 safe investment options. Check the details below:
1. Invest Money in Certificate of Deposit
The most common and safe investment option is to deposit your saved money in bank account for fixed time period and get CD. This option of investment is quite reliable and offers steady return. The percentage on principal amount is likely lower as compared to this investment. Whether you keep your amount in saving account or CD, you don’t need to worry even in case of bank failure; since this investment is fully insured by FDIC.
2. Buy U.S. Treasuries
It is among the safest investment options in U.S. When you want to invest at a right place then you should think about saving bonds issued by government. Although this investment involves risk of United States obligations default yet fact is that investors takes this risk lightly; since they dismiss of the idea of its actual happenings.
3. Purchase Corporate Bonds
There are a number of reputed and well-known companies that finance their operations by issuing bonds to general public. If you want to get good and steady return on your income then you should buy bonds of a strong and popular corporation. This investment is quite safe. At this point, I must say that you need to completely review goodwill and creditability of company before making investment. Interestingly, there are many corporations similar to U.S. government; you just need to find such companies and to buy their bonds. However, you shouldn’t forget that a possibility of default is still there.
4. Invest in Money Market Mutual Funds
This kind of investment offers more return as compared to other options; however it also includes higher risk than others. You can make investment in money market mutual funds that are a collection of cash and cash like investments. It is good to know that this investment is not FDIC insured and there is a possibility that you lose your money during a financial crisis in the country.
5. Think about Annuities
In case you don’t want to invest in above-mentioned 4 options then fifth safe option comes in the form of annuities. This investment brings a guaranteed payout. However, you need to completely check the history and creditability of a company before purchasing annuities. If you don’t go for background check then you could lose your money in case company winds up its operation.
Now it’s time to start thinking about all five options and pick one that suits to you. At the end, I suggest you to invest your money in more than one option; don’t pull all your eggs in one basket.